The future of SAP architectures is hybrid. But according to a survey conducted by the Financials subgroup of the German-speaking SAP User Group (DSAG), where exactly the journey will go has not yet been decided for many organizations.
Nearly half of SAP customers surveyed (47%) still work with on-prem SAP ERP Central Component (ECC), and many have not yet determined which path they want to take to S/4HANA once ECC hits end of maintenance.
From Aug. 15 to Sept. 16, 2024, DSAG surveyed 267 representatives of member company in its Financials subgroup, which includes verticals such as financial services, energy supply, real estate, audit and risk management, data protection, and taxes. In addition to the 47% on ECC, 42% are using S/4HANA (Classic Edition) on-premises. Just 11% of SAP customers surveyed are currently on S/4HANA cloud, with 8% on the Private Edition and 3% on the Public Edition.
Majority of ECC users plan to remain on-premises
When asked about their plans for S/4HANA migration, customers surveyed once again made it clear that on-premises remains the order of business, with 39% targeting on-prem S/4HANA (Classic Edition). One quarter (24%) are seeking to migrate to S/4HANA Cloud Private Edition with RISE with SAP. An additional 5% said they would rely on the S/4HANA Cloud Public Edition with GROW with SAP at some point in the future.
Stephan Hüttmann, DSAG board member for Financials, notes that it is particularly interesting that almost a quarter of the ECC users participating in the survey are still undecided about what the future should look like.
“This is remarkable against the background of the approaching end of maintenance in 2027 or 2030 with extended maintenance,” he explains.
Future outlook is hazy
Hüttmann identifies less-than-transparent licensing and the lack of investment in security as reasons for the indecision. From an application point of view, it’s essential for user companies to know what SAP’s future innovation strategy looks like — for example, with regard to sustainability reporting, as well as regulations such as e-invoicing or AI use cases — in order to be able to plan securely.
Given the number of customers interested in remaining on-prem, the DSAG representative admonished SAP not to forget its on-premises customers in favor of the development of innovations in the cloud, a policy SAP has doubled down on of late — and one its customer continue to balk at.
In addition, many user companies still have questions about their future SAP architecture. Take, for example, Business Technology Platform (BTP), which SAP identifies as a central component of its software architecture. Nearly half (44%) of survey respondents, including those who have already switched to S/4HANA, said they were still undecided whether they would use BTP as a cloud platform with the corresponding solutions and services or take other paths.
“Users still seem to be undecided about the support of financial processes through services and applications at BTP,” Hüttmann concludes, suspecting that users are lacking the information necessary to make an informed decision. To that end, DSAG is planning a webcast series to better inform its members on implementations involving BTP.
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Source: News